South America has been a special part of my life for four decades. I have lived many years in Brasil and Peru. I am married to an incredible lady from Argentina. I want to share South America with you.

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Caterpillar on Friday said its business in Brazil had “basically tanked” as the country suffers from intensifying political turmoil and a deepening recession.

The comments by chief financial officer Bradley Halverson came as the world’s largest seller of mining and construction equipment — which is seen as a bellwether for global industrial demand — cut its full-year sales and profit forecasts.

Caterpillar’s overall first-quarter sales dropped 25.5 per cent to $9.46bn, while earnings fell 77 per cent to 46 cents a share. Latin American sales sank 43 per cent led by Brazil and Mexico, with low oil prices hitting demand for mining equipment.

Brazil is in the midst of its deepest recession in decades, as the commodities slump takes its toll on exports and as President Dilma Rousseff fights against impeachment.

“The Brazilian market has been important for us for a long time,” Mr Halverson told the Financial Times. “We’re really not seeing anything positive happening in Brazil — our business has basically tanked. Fiscal reforms are needed urgently … and more co-operation from the [political] parties.”

He added: “They are going to have to work really hard to maintain a business-friendly environment. In terms of what we’re seeing, we’re slightly below the bottom and it is not getting any better.”

Caterpillar is not the only multinational whose business is suffering as a result of the turmoil in Brazil. PepsiCo and Coca-Cola this week cited the country as the emerging market for which the outlook was a specific concern.

Caterpillar estimated revenues for this year would be $1bn lower than forecast at between $40bn and $42bn. This will push earnings to between $3 and $3.70 a share against a previous outlook of $3.50 to $4 a share, the company said.

Caterpillar is facing a fourth year of falling sales as low commodity prices and a slowdown in China hit economies from Brazil to Russia, crushing investment in machinery. The company said it had seen signs of improvement in the construction market in China and Europe.

However, the improvements were not enough to slow the decline in sales. The revised outlook also came on the back of worse than expected pricing for its equipment.

We’re really not seeing anything positive happening in Brazil — our business has basically tanked. Fiscal reforms are needed urgently … and more co-operation from the [political] parties

Bradley Halverson, Caterpillar

Mr Halverson was optimistic about the outlook for the US, outside the energy industry. “There are positive signs in the US,” he said. “If you’re not around oil and gas I’d say sentiment is a lot more positive than last year at this time.”

After years of strong growth in China, industrial companies such as Caterpillar and Japanese rival Komatsu have been braced for lower overall construction equipment demand on a longer-term basis.

“While first-quarter results were about as we expected, sales and profit were well below the first quarter of 2015,” chief executive Doug Oberhelman said. “Sales declined across the company with substantial reductions in construction, oil and gas, mining and rail. While many of the industries we serve are challenged, we remain focused on what we can control.”

The company’s shares, which had tumbled as oil prices dropped, have risen 15 per cent this year, outpacing Komatsu’s 2.4 per cent increase. They slipped 1.2 per cent to $77.74 on Friday.

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Jack's South America

I started my South American adventure in 1973 in Chile. I had the misfortune to arrive a couple of days before General Pinochet staged his military coup and took power from Salvador Allende. I found myself staying at the Sheraton Hotel in Santiago. As the coup unfolded all sorts of men in US Army officer's uniforms appeared. Even more sinister were men with elegant designer slacks, silk shirts, and Rolex President watches. I knew from my days in Vietnam that they were part of the CIA Phoenix Program team. These people had been responsible for political kidnappings and assassinations in Vietnam. I was asked what I was doing there and my military record checked with the Pentagon. I did not end up in the infamous soccer stadium where many people were executed including two Americans.

I went on to spend 2 years in Peru and Five years in Brasil where I lived through the awful days of the military dictatorships.

It all was not sadness and war. I met many wonderful people who had to survive under difficult circumstances. I came to love and admire them. South America always has a special place in my heart. My first wife was from Brasil and my dear wife Elena is from Buenos Aires.

About Me

When I was a very young man I had an incredible grandmother named Sarah Elizabeth Walters. She told me the following words: "Son don't let the grass grow under your feet." I took those words to heart and went out to see the world. My life has been ana adventure all over the world. I have lived on six of the seven continents. I have been lucky to live this long.